I don't think that it is an insertion of a foreign gene. Rather it is the activation of an pre-existing gene ( SLCO1B3) that is normally turned off in shell production. Granted the activation was via an foreign retrovirus. But, unlike BT-containing or "roundup-ready" GMOs, it can not be said that a foreign gene was inserted. The article behind the one Maggie posted is more detailed:

I was surprised to read that araucanas "occasionally" lay a colored egg. My family has had them for years and ours always laid bluish-green eggs. Also, when they cross-bred with the buff orpingtons and other breeds that lay brown eggs, their offspring laid eggs that were a mix of the green and brown. Sort of a nice olive green color.

The blue egg situation is more complicated than Maggie's post, the PopSci post she referenced, and even the original PLOS article suggest.

Much of the reportage implies that blue eggs are symptomatic of a current or recent viral infection, when they're the result of one of the chicken's ancestors being infected with a retrovirus that inserted itself into that ancestor's DNA in just the right place (two slightly different places in two distinct events on two continents, actually) to "turn on" the dormant ability to create blue eggshells. The original paper mentions three (not two) breeds of blue-egg layers, but there are others, including indigenous breeds that contributed to the Araucana and related blue-egg breeds.

As SJB noted, hens with the blue-egg gene will normally lay blue-shelled eggs all their lives. The color may vary in intensity or be modified by a surface layer of brown pigment to create sage green, olive, or brown eggs, but the shell underneath will still be blue. My mixed-breed "Easter Egger"/"Americana" hens all lay blue eggs, though one with some Rhode Island Red in her background occasionally lays eggs with a green tint or a surface layer of dark brown or gray speckles.

Is there a correlation to blue eggs as to how Scottish tartans reflect that the plants in a particular area? Buchanan noticeably has a blue strand through it flagging the flora that was available to the dyers. You can tell lots about local plants by the color of the wings of butterflies who flourish in that area.

Our Araucanas don't occasionally lay blue (pink, green) eggs, but consistently do so. The most common color is blue, but pinkish and greenish eggs also occur. As SLWilliamson noted, the situation is more complex than the articles indicated. But. when is it not.

@Preston: Hah, thought someone would bring up retrovirus genes. I won't disagree about the 'hair-on-fire' freak-out -- people who don't know genomics can be very scared of deliberate human genomic manipulation. But there is a difference, in some people's minds, between:

1) The gene that causes blue eggs was already in chickens and it just got turned on.vs.2) The gene that causes blue eggs came from a non-chicken source.

The Gag, Pol, Env genes carried by retroviruses are not the cause of the blue egg so they are easy to ignore (not to mention being found all over, in one form or another, the chicken genome anyway.) But the 'blue egg' gene -- natural and native to the chicken? ... or foreign and non-native? (OMG!)

The parallels to some people's reactions to GMOs should be obvious. Unfortunately we cannot, in good conscious, use the 'blue egg' gene to say to the non-geneticists, "hey nature does it so we can do it as well and as safely."

The strain makes blue eggs consistently - well that's a billionth of a nanosecond in evolutionary terms and it demonstrates that this sort of thing happens all the time, even though plants do it much much more often. Also, they mention that there are strains with similar mutations in Asia and the Americas, so these insertions occurred more than once. So these events happen all the time and that's no surprise.

The paper itself is kind of disjointed. Their explanation of how they went from SNP analysis to their test crosses is a bit off and then they don't describe the results of the crosses. The SNP analysis sort of feels like it was duct taped onto paper.

Are your birds US-type or British-type Araucanas? I ask because blue eggs are an integral part of both breed standards, so pinkish eggs would seem to indicate outcrossing to at least one breed without the blue gene.

As for the virus it is dead, dead, dead. Not going anywhere. Basically at some point in the evolutionary past a virus integrated all or part of its genome into the chicken genome in such a place that it turned on the blue egg gene. That integrated viral genome (now chopped up and mostly inactive) isn't going to pop out of the chicken and make new viruses. I.e., there is not an active virus floating around in the chicken. So no need for look for "an advantage to the virus".

As Preston alluded to, viruses commonly integrate into their host organism in random locations. Sometimes this does something good long-term for the host and its off-spring, sometimes not and most of the time nothing much happens. But this integration is much different than what is normally thought of viral activity -- that of reproducing within a host cell and then spreading (e.g, like a cold virus).

As for the evolutionary advantage to the chicken. Preston may be correct about the blue egg recognition -- blue eggs do occur in wild birds. But really at this point in chicken evolution they are so manipulated by human activity that it is hard to say what would be long-term advantages in the wild as compared to white or brown eggs. In other words humans like chickens with blue eggs thus those chickens will be kept around even if they would not survive in the wild.